Research Briefing
By Georgina Hutton
8 May 2024

Business statistics

Summary
1
Businesses in the UK
2 Businesses by size
3 Businesses by region
4 Businesses by industry
5 Business openings and closures
6 Women in business
7 Ethnicity of businesses leaders
8 Further resources on business diversity
9 UK business statistics: sources and coveragecommonslibrary.parliament.uk

Number CBP 06152

Business statistics

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Canary Wharf / winter by George Rex. Licensed under CC BY 2.0 / image
cropped.
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Business statistics

Contents
Summary

4

1

Businesses in the UK

8

1.1

How many businesses are there in the UK?

82

Businesses by size

123

Businesses by region

14

4

Businesses by industry

16

5

Business openings and closures

18

5.1

Business births and deaths in the UK

18

5.2

Business births and deaths by industry

19

5.3

Business births and deaths by country and region

20

6

Women in business

21

6.1

Female-led small and medium-sized enterprises (SMEs)

21

6.2

Female-led start-ups

21

6.3

Women on boards

22

Women on boards: targets

23

7

Ethnicity of businesses leaders

25

7.1

Self-employed business owners

25

7.2

Minority ethnic group-led SMEs

25

7.3

Ethnic diversity of company boards

27

Board leadership positions

28

7.4

Minority ethnic entrepreneurs

29

8Further resources on business diversity

30

9UK business statistics: sources and coverage

32

3Commons Library Research Briefing, 8 May 2024

Business statistics

Summary

Businesses over time
There were 5.6 million private sector businesses in the UK as of 1 January2023, 0.8% more than in 2022. This was the first year since 2020 in which thebusiness population has increased. The total business population is still 7.1%
lower than January 2020 levels.
Over the longer term, since 2000, the total business population has increased
by 60%. This growth, and the decline in the business population since 2020,
has been driven by small businesses with no employees, the largest categoryof UK businesses.

Businesses with no employees have driven changes in thebusiness population% change in business population since 2000, by business size band100

No employees

1–49 employees

50–249 employees

250+ employees

75
50
25
0
-25
2000

2003

2006

2009

2012

2015

2018

2021

Source: DBT, Business population estimates, 2023

Businesses by size
There were 5.5 million small or medium-sized businesses (SMEs) in the UK in
2023, representing over 99% of the business population. SMEs are businesses
employing 0-249 people, including sole traders. SMEs accounted for 61% of
UK employment and 7% of business turnover.

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Business statistics

There were around 8,000 large businesses in January 2023 (with 250 or more
employees). While representing just 0.1% of the business population, thesebusinesses support 39% of jobs and nearly half of all non-financial businessturnover.
The chart below shows the proportion of UK businesses by size, along with
their share of employment and non-financial business turnover.

A small number of large businesses support a highproportion of jobs and turnoverBusinesses by employment size, UK, 2023
Businesses
Employment
Turnover

95%

47%
39%
32%
21%

Micro (0-9)

4% 16% 15%
Small (10-49)

1% 13%

17%

Medium (50-249)

0.1%
Large (250+)

Source: DBT, Business population estimates, 2023. Turnover excludes the financial services sector.

Businesses by location
London has the highest number of businesses of any region or country in theUK, including on a per-person basis.
There were 1.0 million businesses in London in January 2023, equal to 1,477
businesses per 10,000 resident adults. London and the South East of England
combined accounted for just over a third of UK businesses. In the UK overall
there were 1,015 businesses per 10,000 resident adults.
The excel sheet attached to this briefing paper provides business numbers by
Parliamentary constituency, including by size and industry.

Businesses by sector
Service industries accounted for 76% of businesses, 80% of employment and
72% of turnover (excluding the financial services sector). The retail industry

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Business statistics

accounted for 34% of business turnover, but only 10% of the businesses
population. The manufacturing sector accounted for 5% of businesses, 9% of
employment and 14% of turnover.

Business openings and closures
2022 was the first year since 2009 and 2010 that had a higher rate of businessclosures (11.8%) than new businesses openings (11.5%). There were 337,000
new businesses opened in 2022, down 27,000 on the previous year. There
were 345,000 business closures in 2022, around 18,000 more than 2021.
The transport and storage sector had the highest proportion of business
openings and business closures.

Women in businessOf the UK’s small and medium-sized enterprises with employees, 18% were
led by women in 2022, according to data from the government’s annual Small
Business Survey.
42.6% of FTSE 100 and 42.1% of FTSE 350 directorships were occupied by
women in January 2024. Around half of all new FTSE 100 board appointments
were women (47%).
In 2022, just over 20% of all new companies were all-female led, up from 17%
in 2018, according to the 2023 Rose Review Progress Report. Around 2 in 5
entrepreneurs in the UK were women (44%) in 2022, up from around 1 in 3 in2018 (33%), according to the Global Entrepreneurship Monitoring survey.

Ethnicity of business leaders
There is no comprehensive data on the ethnicity of UK business owners andleaders.
The ONS has estimated that around 12% of UK self-employed business owners
identify as being from a minority ethnic group. Of these, business owners weremost likely to be from Indian (3.4% of business owners) or Black (2.1%) ethnic
groups.
Of the UK’s small and medium-sized enterprises with employees, 6% wereminority ethnic group led in 2022, according to data from the government’s
annual Small Business Survey. This proportion has been roughly the sameeach year since 2015.

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Business statistics

96% of FTSE 100 companies and 60% of FTSE 250 companies had at least one
director from a minority ethnic background as of December 2022,
representing 18% and 11% of all available director posts, respectively. There
are relatively few people from minority ethnic groups in Chair and executive
director roles (for example, CEO and CFO). There were 31 executive directors
from minority ethnic backgrounds in the FTSE 100 and 34 in the FTSE 250.
The British Business Bank in 2020 found that 4.4% of the UK’s entrepreneurs
were Black, 5.9% were from Asian or other minority-ethnic minority groups
and 89.9% were White. The Bank found that even after controlling for factors
such as education, income, sector and working patterns, there were systemic
disadvantages faced by entrepreneurs that come from minority ethnic
backgrounds and who are female.

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Business statistics

1

Businesses in the UK

1.1

How many businesses are there in the UK?
As of 1 January 2023, there were 5.6 million private sector businesses in theUK. 1
The chart below shows the number of businesses in the UK since 2000. 2

Private sector businesses in the UK
2000-23, millions
6
5
4
3
2
1

The number ofbusinesses in the UK
rose by 0.8%
between 2022 and
2023

2023

2022

2021

2020

2019

2018

2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

0

Source: Department for Business and Trade, Business population estimates 2023, 5 October 2023, Table
25

The business population grew by 0.8% between January 2022 and January
2023. This was the first increase in the number of businesses since 2020.
The private sector business population fell each year between 2020 and 2022
– the only time since comparable records began that the business population
fell in two consecutive years. The fall of 6.5% in the number of businesses
between 2020 and 2021 was the largest fall since the series began in 2000.
Although the number of businesses grew between 2022 and 2023, the total
population is still 7.1% lower than pre-pandemic (January 2020) levels.

1

2

8

Private sector businesses excludes central and local government, charities and other non-profit
organisations.
Department for Business and Trade, Business population estimates 2023, 5 October 2023

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Business statistics

Over the longer term, the number of businesses has grown from 3.5 million
businesses in 2000 to 5.6 million in 2023 – an increase of 2.1 million or 60%
over the period. 3

Businesses with no employees have driven growth in
the business population
Businesses can take a number of different legal forms and can range fromself-employed sole traders to large multinationals.
The growth in the number of businesses since 2000, and the fall since 2020,
has been largely driven by small businesses with no employees – the largest
category of UK businesses (see section 2). The proportion of businesses thatare employers has fallen from around a third in 2020, to around a quarter in
2023, shown in the table overleaf.
This decline in the number of employers as a proportion of all businesses isdue to the growth in self-employment over this period and has been driven bysole-traders. 4 A number of reasons have been put forward to explain thistrend, including tax incentives and an ageing workforce. 5

Businesses with no employees have driven changes in thebusiness population% change in business population since 2000, by business size band100

No employees

1–49 employees

50–249 employees

250+ employees

75
50
25
0
-25
2000

2003

2006

2009

2012

2015

2018

2021

Source: DBT, Business population estimates 2023, 5 October 2023, Table 25

3
4
5

9

Department for Business and Trade, Business population estimates 2023, 5 October 2023
Institute for Fiscal Studies (IFS), Who are business owners and what are they doing?, 9 July 2019.
For further discussion see: IFS, What does the rise of self-employment tell us about the UK labour
market?, 19 November 2020; IFS, Who are business owners and what are they doing?, 9 July 2019;
Commons Library, Employment Status, 28 March 2018.

Commons Library Research Briefing, 8 May 2024

Business statistics

The number of businesses without employees also led the decline inbusinesses numbers during the pandemic, with this category seeing a 9% fall
between 2020 and 2021 and a 3% fall between 2021 and 2022. In comparison,
the number of small, medium and large employers increased between 2021
and 2022.
The decline in the number of businesses with no employees correlates with adecline in the population of self-employed workers during the coronavirus
pandemic. According to the Office for National Statistics (ONS) Labour Force
Survey (LFS), the number of self-employed workers was 15% lower in Q1 2022
compared to Q1 2020. 6 The ONS explains that some of this fall is partly due topeople changing their survey responses during the pandemic. For example,
some people who own their business but who pay themselves through PAYE
began to describe themselves as employees when they realised they could
claim on the Coronavirus Job Retention Scheme. 7 The business data shown
here is partly drawn from the LFS, so this survey behaviour will also impact
the number of businesses recorded. 8

6
7

8

10

ONS, Labour Force Survey, A01 Table 3, 15 November 2022.
ONS, Painting the full picture: what our statistics tell us about the labour market, Debra Leaker, 29
January 2021. Because the Business Population Estimates are also informed by the Labour Force
Survey, this in theory could also affect the estimates for number of businesses with no employees.
The Business Population Estimates use LFS data to estimate the number of sole traders andpartnerships that are not registered for VAT and PAYE.

Commons Library Research Briefing, 8 May 2024

Business statistics

Private sector businesses in the UK, 2000-2023
Number of businesses

Change on year

% change on% that are(000s)(000s)

year

employers

2000

3,467

-

-

32.1%

2001

3,502

35

1.0%

32.8%

2002

3,573

71

2.0%

32.5%

2003

3,679

106

3.0%

32.1%

2004

3,925

247

6.7%

29.6%

2005

3,927

1

0.0%

29.9%

2006

4,125

199

5.1%

29.0%

2007

4,272

146

3.5%

28.7%

2008

4,284

12

0.3%

28.9%

2009

4,375

92

2.1%

28.3%

2010

4,483

108

2.5%

27.3%

2011

4,589

106

2.4%

26.4%

2012

4,818

229

5.0%

25.7%

2013

4,914

97

2.0%

24.6%

2014

5,247

333

6.8%

24.3%

2015

5,401

154

2.9%

24.3%

2016

5,498

97

1.8%

24.1%

2017

5,695

197

3.6%

24.0%

2018

5,668

-27

-0.5%

24.5%

2019

5,868

200

3.5%

24.0%

2020

5,981

113

1.9%

23.6%

2021

5,591

-390

-6.5%

25.3%

2022

5,509

-82

-1.5%

25.7%

2023

5,555

46

0.8%

26.0%

Notes: data is at 1 January each year.
Source: Department for Business and Trade, Business population estimates 2023, 5 October 2023

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Business statistics

2

Businesses by size

The table below shows businesses in the UK by size (the number of employees
per business).

Private sector businesses in the UK by number of employees, 2023
Businesses

Employment

TurnoverBusinesses

Employment

Turnover

000s

000s

£ billions

%

%

%

With no employees

4,110

4,485

331

74%

16%

7%

SMEs (0-249 employees)

5,547

16,715

2,355

99.9%

61%

53%

Micro (0-9 employees)

5,287

8,773

923

95%

32%

21%

Small (10-49 employees)

223

4,346

670

4%

16%

15%

Medium (50-249 employees)

37

3,596

763

1%

13%

17%

Large (250+ employees)

810,809

2,124

0.1%

39%

47%

5,555

27,524

4,480

100%

100%

100%

Total, all businesses

Notes: Turnover excludes the financial services sector. Figures are rounded.
Source: Department for Business and Trade, Business population estimates 2023, 5 October 2023, Table 1.

The usual definition of small and medium sized enterprises (SMEs) is any
business with fewer than 250 employees. There were 5.5 million SMEs in the
UK in 2023, which was 99.9% of all businesses. 9
Micro-businesses have 0-9 employees. There were 5.3 million micro-

95% of businesses
businesses in the UK in 2023, accounting for 95% of all businesses. Whilein the UK have fewer representing the vast majority of businesses in the UK, micro-businesses only
account for 32% of employment and 21% of turnover. 10
than 10 employees
There are around 8,000 large businesses (defined as businesses with 250 ormore employees), accounting for 0.1% of businesses but 39% of employment
and 47% of turnover.
The following chart shows the proportion of businesses, employment andturnover accounted for by businesses of different size.

9
10

12

Department for Business and Trade, Business population estimates 2023, 5 October 2023.
Turnover excluding the financial services sector.

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Business statistics

A small number of large businesses support a highproportion of jobs and turnoverBusinesses by employment size, UK, 2023
Businesses
Employment
Turnover

95%

47%
39%
32%
21%

Micro (0-9)

4% 16% 15%
Small (10-49)

1% 13%

17%

Medium (50-249)

0.1%
Large (250+)

Source: DBT, Business population estimates 2023, 5 October 2023, Table 1. Turnover excludes thefinancial services sector

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3

Businesses by region

The chart below shows how the number of businesses per head of populationdiffers across the regions of the UK.

Number of businesses per 10,000 resident adults
UK nations and regions, 2023
ScotlandNorth East
Northern Ireland

653
718
805

Wales

856

Yorkshire & Humber

872

North West904

West Midlands

933

East Midlands

955

United Kingdom

1,015

East of England

1,103South West

1,104South East

1,125

London1,477

Notes: Business count is based on businesses’ head office location.
Source: DBT, Business population estimates 2023, 5 October 2023, Table 8

In the UK in 2023 there were 1,015 businesses per 10,000 resident adults. In
London there were 1,477 businesses per 10,000 residents. In Scotland there
were 653 businesses per 10,000 residents. 11
Just over a third of UK businesses are in London and the South East
(1.0 million in London and 0.9 million in the South East). Northern Ireland has
0.1 million businesses, the fewest of any country or region in the UK.
Overall, there was a 0.8% decrease in the number of businesses in the UK
between 2022 and 2023. Not all regions and nations saw a fall in business
numbers. The greatest percentage fall was in Scotland, where the number ofbusinesses fell by 12.5% between 2022 and 2023, followed by Northern Ireland
11

14

Department for Business and Trade, Business population estimates 2023, 5 October 2023, Table 8

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Business statistics

where the number of businesses fell by 4.8%. The North West saw a 6.3%
increase in the number of businesses between 2022and 2023, the largest of
any country or region.
The table below shows data on businesses by country and region of the UK.

Business statistics by regions and countries of the UK, 2023
Number of enterprises% change

Per 10,000 resident

Employers

SMEs(000s)

2022-23

adults(000s)(000s)

North East

156

0.8%

718

42

0

North West

545

6.3%

904

147

0

Yorkshire & Humber

389

0.9%

872

109

0

East Midlands

382

3.8%

955

99

0

West Midlands

448

2.5%

933

121

0

East of England

569

4.8%

1,103

143

0

London

1,049

1.1%

1,477

255

0

South East

852

1.0%

1,125

210

0

South West

524

-2.5%

1,104

396

0

England

4,916

2.0%

1,067

1,253

0

Wales

219

0.1%

856

57

0

Scotland298-12.5%

653

96

0

Northern Ireland

122

-4.8%

805

39

0

United Kingdom

5,555

0.8%

1,015

1,445

5,547

Notes: Business count is based on businesses’ head office location. Figures are rounded to nearest 100.
Source: DBT, Business Population Estimates, 2023.

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4

Businesses by industry

The table below shows private sector businesses by industry in the UK in 2023.

Businesses by industry in the UK, 2023
Number of businesses

Employment

Turnover

000s

%

%

%

Agriculture, mining and utilities

171

3%

3%

6%

Manufacturing

269

5%

9%

14%

Construction

883

16%

8%

8%

Total services

4,232

76%

80%

72%

548

10%

18%

34%

Of which:
RetailTransportation

348

6%

6%

4%

Accommodation & food

226

4%

9%

2%

IT and communications

319

6%

5%

8%

Financial and insurance

80

1%

4%

..

Real estate activities

146

3%

2%

2%

Professional and scientific

771

14%

10%

10%

Administrative & support services

497

9%

11%

7%

Education

310

6%

2%

1%

Health and social work

343

6%

7%

2%

Arts and recreation

281

5%

3%

2%

Other service activities

364

7%

3%

1%

5,555

100%

100%

100%

Total

Note: Turnover excludes the financial services sector. Data is for 1 January 2022.
Source: DBT, Business Population Estimates 2023, Table 4.

Retail businesses
account for over athird of UK turnover(excluding financial
services)

In 2023 there 4.2 million businesses in the services industries, just over threequarters of all businesses in the UK. 12 The biggest of the service industries interms of the number of businesses was the professional and scientific sector,
which at 771,000 businesses accounted for 14% of businesses. The retailsector and the administrative and support services sector accounted for 10%
and 9% of all businesses, respectively.

12

16

DBT, Business Population Estimates, 2022

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Business statistics

Overall, businesses in the service industries accounted for 80% of
employment and 72% of total turnover. 13 Businesses in the retail sector
accounted for 18% of employment and 34% of turnover in 2023.
Construction sector businesses accounted for 16% of all businesses, but only
8% of employment and turnover. A large number of construction workers are
self-employed, which increases the number of enterprises, but not the
number employed in the sector.
Manufacturing firms accounted for 5% of businesses, 9% of employment and
14% of turnover.

13

17

Turnover excludes financial services businesses.

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Business statistics

5

Business openings and closures

5.1

Business births and deaths in the UK
The chart and tables below show new business openings (business births) andbusinesses that ceased trading (business deaths) in each year from 2001 to
2022. The business birth rate is the proportion of active businesses that began
trading in the reporting year. The business death rate is the proportion ofactive businesses that ceased trading in the reporting year.
2022 was the first year since 2009 and 2010 that had a higher rate of businessdeaths (11.8%) than business births (11.5%). There were 337,000 businessbirths in 2022, down 27,000 on the previous year. The business birth rate was
11.5%, down from 12.4% in 2021. 14 There were 345,000 business deaths in
2022, around 18,000 more than 2021. The business death rate was 11.8%, up
from 11.1% in 2021.
The volume of business births and deaths is generally proportionate to thebusiness population as a whole – there are more business births and deaths
in a bigger business population.

Business birth and death rates in the UK
Birth rate: new businesses as a % of active businesses
Death rate: businesses that ceased trading as a % of active businesses
16%
14%Birth rate

12%
10%
8%

Death rate

6%
4%
2%
0%
2001

2003

2005

2007

2009

2011

2013

2015

2017

2019

2021

Source: ONS, Business Demography, 22 November 2023; House of Commons Library calculations

14

18

ONS, Business Demography, 17 November 2022.

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Business statistics

Business birth and death rates, UK
Births (000s)

Birth Rate

Deaths (000s)

Death Rate

2001

243

11.7%

212

10.2%

2002

243

11.5%

213

10.1%

2003

267

12.5%

232

10.9%

2004

280

13.0%

244

11.3%

2005

275

12.6%

228

10.5%

2006

256

11.6%

207

9.4%

2007

281

12.3%

224

9.8%

2008

267

11.5%

223

9.6%

2009

236

10.1%

277

11.8%

2010

235

10.0%

249

10.6%

2011

261

11.2%

230

9.8%

2012

270

11.4%

252

10.6%

2013

346

14.1%

238

9.7%

2014

350

13.7%

246

9.7%

2015

383

14.3%

282

10.6%

2016

398

14.4%

269

9.7%

2017

357

12.5%

331

11.7%

2018

349

12.3%

297

10.4%

2019

364

12.6%

303

10.5%

2020

333

11.5%

299

10.3%

2021

364

12.4%

327

11.1%

2022

337

11.5%

345

11.8%

Source: ONS, Business Demography, 22 November 2023; House of Commons Library calculations
Notes: excludes non-VAT registered businesses with no employees; Birth rate: new businesses as a % of active
businesses. Death rate: businesses that ceased trading as a % of active businesses.

5.2

Business births and deaths by industry
The transport and storage industry (which includes postal services) had thehighest business birth rate in 2022, at 21.2%, and the highest death rate, at
23.8%. 15 This industry has had the highest business birth rate since 2017, but
2022 was the first year that the death rate exceeded the birth rate.
The pandemic saw an increase in couriers and road freight transportbusiness. Both industries saw a fall in birth rate in 2022 and for couriers, asignificant rise in business deaths in 2021 and 2022. 16

15
16

19

ONS, Business Demography 2022, 23 November 2023.
ONS, Business Demography 2022, 23 November 2023.

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Business statistics

Most industries have a large proportion of births that are either sole tradersor single-employee businesses. The accommodation and food services
industry is an exception, with over 70% of new business having two or more
employees.17

5.3

Business births and deaths by country andregionIn 2022, London, the North East, Wales and Northern Ireland were the only
areas that had a greater number of business births than business deaths.
London had the highest birth and death rate (both 12.7%) of all countries andregions.

Business births and deaths by region and country, 2022
BirthsBirth rate

DeathsDeath rate

London76,845

12.7%

76,51012.7%

Yorkshire and the Humber

25,895

12.6%

23,640

11.5%

North West36,22012.5%

36,525

12.6%

North East

9,720

12.4%

9,485

12.1%

West Midlands

28,69512.1%

30,105

12.7%

Wales

12,09011.6%

11,66011.2%

East Midlands

22,68511.5%

26,000

13.2%

East

31,85011.0%

32,615

11.2%

Scotland

18,87010.8%

19,640

11.3%

South West24,51010.3%

24,710

10.4%

South East

44,16010.0%

49,310

11.1%

Northern Ireland

5,385

8.3%

5,290

8.2%

United Kingdom

336,925

11.5%

345,490

11.8%

Source: ONS, Business Demography 2022, 23 November 2023; House of Commons Library calculations

17

20

ONS, Business Demography 2022, 23 November 2023.

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Business statistics

6

Women in business

6.1

Female-led small and medium-sizedenterprises (SMEs)
In 2022, 18% of small and medium-sized enterprises (SME) employers were
led by women (meaning that they were either led by one woman or by amanagement team that is majority female), according to the Government’s
annual Small Business Survey. 18 This is a one percentage point fall compared
to 2021, and similar to figures since 2015.
The proportion of SMEs with no employees that were owned or led by women
was higher, at 20% in 2022, around the same as in 2021 and 2020. 19
Examining only SMEs with employees, women-led businesses were most likely
to be in the health and social care (44%), education (34%), other services(29%) and accommodation and food service (28%) sectors. 20 The “otherservices” sector includes businesses such as hair and beauty salons, sports
facilities and funeral homes.

6.2

Female-led start-ups
In 2022, just over 20% of all new companies were all-female led, up from 17%
in 2018, according to the 2023 Rose Review Progress Report. 21 Women in the
UK established over 150,000 new companies in 2022 – more than twice as
many as in 2018. 22
The Alison Rose Review of female entrepreneurship was a Treasurycommissioned review which began in 2018 and reports annually, looking at
the barriers faced by women starting and growing a business. 23 The firstreview report, published in March 2019, stated that “up to £250 billion of new

18
19
20
21

22
23

21

DBT, Small business survey (employers), 31 August 2023, data table 30.
DBT, Small business survey (no employees), 31 August 2023, data table 29.
DBT, Small business survey (employers), 31 August 2023, data table 30.
Alison Rose Review of female entrepreneurship, Progress Report 2023, 22 February 2024 page 6. A
company is a business that has been incorporated at Companies House under the Companies Act
2006.
Alison Rose Review of female entrepreneurship, Progress Report 2023, 22 February 2024, page 6.
HM Treasury, The Alison Rose Review of Female Entrepreneurship, 8 March 2019.

Commons Library Research Briefing, 8 May 2024

Business statistics

value could be added to the UK economy if women started and scaled new
businesses at the same rate as UK men”. 24
Around 10% of women in the UK economy were early-stage entrepreneurs in
2022, compared to around 12% of men, according to the Global
Entrepreneurship Monitoring (GEM) survey (a consortium of international
academic institutions that run a global annual survey of entrepreneurship
activity).25 This includes owning or running a business that is less than threeand-a-half years old. This means that around 2 in 5 entrepreneurs in the UK
were women (44%), up from around 1 in 3 in 2018 (33%). 26 The proportion of
female entrepreneurs in the UK was higher than in France and Germany, but
lower than in the United States. 27
The GEM found that the proportion of new businesses that transition toestablished businesses (operating for more than three-and-a-half years) islower for female-led businesses than male-led businesses. The GEM reported
that 4.1% of women in 2022 were ‘established business owners’ compared to
8.9% of men – a gap of 4.8 percentage points. 28

Gender and ethnicity
Research conducted by the British Business Bank in 2020, the governmentowned bank that supports businesses access finance, looked at the genderand ethnicity of UK entrepreneurs. The Bank reported that Black Women had
the biggest gap between the proportion of women entrepreneurs compared
to working women overall. Black Women made up 28% of Black
entrepreneurs, compared with 50% of the Black working population. For
Asian and other ethnic-minority women and White women, this gap was half
the size. 29

6.3

Women on boards
In January 2024, 42.6% of FTSE 100 directorships were occupied by womenand around half of all new FTSE 100 board appointments were women

24

25

26

27
28

29

22

HM Treasury, The Alison Rose Review of Female Entrepreneurship (PDF), Executive Summary page 6,
8 March 2019.
The GEM reports on the ‘total early-stage entrepreneurial activity’ (TEA) rate, which is thepercentage of the working-age adult population (aged 18–64) who are early-stage entrepreneurs.
The GEM reported a 9.7% TEA rate for females and a 12.4% TEA rate for males. Global
Entrepreneurship Monitor, UK Report 2022/23 (PDF), page 18.
House of Commons Library calculation based on GEM TEA rates. Global Entrepreneurship Monitor,
UK Report 2022/23 (PDF), page 18.
Global Entrepreneurship Monitor, UK Report 2022/23 (PDF), page 18.
Global Entrepreneurship Monitor, UK Report 2022/23 (PDF), page 18-19. The Established Business
Owner (EBO) rate is the proportion of the adult population that is currently an owner-manager of anestablished business (operating for more than three and half years).
British Business Bank, Alone Together: Entrepreneurship and diversity in the UK, 2020, page 29.

Commons Library Research Briefing, 8 May 2024

Business statistics(47%). 30 Nearly three-quarters of all FTSE 100 Boards have at least 40%
women on their boards – the current voluntary target set by the FTSE Women
Leaders Review (discussed further below). 31
In January 2024, 41.8% FTSE 250 directorships and 42.1% of FTSE 350
directorships were held by women. 32
The following chart shows how the proportion of women on FTSE 100 boards
has increased steadily since 1999 with more significant increases in recent
years.

FTSE 100 board members by gender
1999-2022, %
100%
80%
60%

Men
40%
20%
0%
1999

Women
2002

2005

2008

2011

2014

2017

2020

Source: Cranfield University, Female FTSE Board Report, 2022 and House of Commons Library

Women on boards: targets
A government backed voluntary target that FTSE 100 boards should have aminimum of 25% female representation by 2015 was set in the 2011 report byLord Davies of Abersoch, Women on boards. 33 In October 2015, it wasannounced that this target had been met, and that 26% of FTSE 100 board
members were women. 34
Building on the work of Lord Davies, in 2016 the government commissioned
the Hampton-Alexander Review on FTSE women leaders, which reported eachyear from 2016–2021 on women representation at FTSE 350 firms. In 2016 theHampton-Alexander Review recommended that FTSE 350 companies should
30

31
32
33
34

23

There were 445 women serving on FTSE 100 Boards out of a total of 1044 directorships. FTSE Women
Leaders, FTSE Women Leaders Review 2024 (PDF), February 2024, page 15.
FTSE Women Leaders, About Us, accessed 27 February 2024.
FTSE Women Leaders, FTSE Women Leaders Review 2024 (PDF), February 2024, Appendix page 48.
Lord Davies of Abersoch and BIS, Women on boards, February 2011, pg. 4
BIS, Women on boards: 5 year summary (Davies review), 29 October 2015.

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Business statistics

aim for a minimum of 33% representation of women on their boards and intheir senior leadership positions (Executive Committee and Direct Reports) by
2020.
The final Hampton-Alexander report (PDF) was published in February 2021. It
reported that FTSE 350 Boards met and exceeded the 33% target on average(220 or 65% of companies met the target). The target for women in FTSE350
leadership roles however fell short of the target, with 85 companies (30%)
achieving the target. 35
The Hampton-Alexander Review has been succeeded by the FTSE Women
Leaders Review. This review has set new voluntary targets, including that
FTSE 350 companies should reach:••

40% representation of women on FTSE 350 Boards and leadership teams(Executive Committee and Direct Reports) by the end of 2025; andFTSE 350 companies should have at least one woman in a key leadershiprole (Chair or Senior Independent Director role on the Board and/or one
woman in the Chief Executive Officer or Finance Director role) by the endof 2025. 36

The Cranfield School of Management, Female FTSE Board Reports, provide
further statistics on female representation on FTSE 100 and FTSE 250 company
boards including commentary on the voluntary approach to representation
targets.

35
36

24

Hampton-Alexander Review, FTSE Women Leaders, February 2021 (PDF), page 10.
FTSE Women Leaders, Recommendations & Progress [accessed 18 November 2022].

Commons Library Research Briefing, 8 May 2024

Business statistics

7

Ethnicity of businesses leaders

There is limited available data on the ethnicity of UK business owners andleaders. Various reports have highlighted the lack of good data in this area,
particularly on detailed ethnic groups, and the implications this has for policy
development. 37
The following sections present available data on the ethnicity of businessowners, business leaders and entrepreneurs.

7.1

Self-employed business owners
The Office for National Statistics has produced ad-hoc experimental
approximations of ethnicity of UK business owners, based on data for a subset of self-employed workers. 38
It found that in 2021 around 12% of UK business owners identified as beingfrom a minority ethnic group and around 88% of business owners identified as
being from a White ethnic background. 39 Of the minority ethnic groups
reported, business owners were most likely to from Indian (3.4% of businessowners) or Black (2.1%) ethnic groups.

7.2

Minority ethnic group-led SMEs
The Department for Business and Trade Small Business Survey reports
annually on the proportion of small and medium sized businesses that are

37

38

39

25

ONS, Exploration of options to source data on the ethnicity of business owners, 23 November 2021;
All Party Parliamentary Group (APPG) for Black and Minority Ethnic Business Owners, BAME Business
Owners: Covid-19 response, September 2020; Federation of Small Businesses, Unlocking Diversity:
the value of ethnic minority firms to UK economic activity and enterprise, July 2020; Minority
Supplier Development UK, Minority Business Matters published by Minority Supplier Development,
February 2021.
ONS, Approximation of business owners by ethnic group for the UK and English regions, 2012 to
2021, 13 February 2023. The regional estimates are not quoted in this briefing as the estimates arelargely too small to give robust results.
Note that the sub-categories do not sum to the total due to some business owners having unknown
ethnic group. White includes respondents in England, Wales and Scotland identifying themselves as'White - Gypsy or Irish Traveller' and respondents in Scotland identifying themselves as 'White Polish'.

Commons Library Research Briefing, 8 May 2024

Business statistics

minority ethnic group led (MEG-led). 40 MEG-led is defined as having a personfrom a minority ethnic group in sole control or having a management team at
least half of which are from an minority ethnic group.
In 2022, 6% of SMEs with employees were MEG-led, roughly the same as ineach year since 2015. 41 MEG-led SME employers were most likely to be in thefollowing sectors: 42
•
•
•
•
•

IT and communications (9%)
business administration services (8%)
food and accommodation sector (8%)
education (8%)
health and social care (8%).

In England, 6% of SME employers were MEG-led, compared to 5% in
Scotland, 3% in Wales and 1% in Northern Ireland.
The following chart shows the most likely ethnicity of the leaders of SME
employers with owners or directors from minority-ethnic groups. The most
likely ethnic origin of the owners/directors was Indian (22% of leaders of SME
employers with owners/directors from minority-ethnic background).

Ethnic group of business leaders: SME employers% SME employers with owners/directors from minority-ethnic groups in 2022
Indian22%

Mixed background

15%

Other

12%

Any other Asian background10%

Pakistani

8%Black African

7%

White

6%

Black Caribbean

5%

Chinese2%

Any other Black background

2%

Arab

1%

Bangladeshi

1%

Notes: White includes White British, White Irish and any other White background. The ethnic group of
22% of employers could not be classified.
Source: DBT, Small business survey (employers) 2022, 31 August 2023, Table 27 A20.

40

41
42

26

In the survey, minority ethnic group means “those that are not White British, where White British
includes White English, White Scottish etc.”.
DBT, Small business survey (employers), 31 August 2022, data table 32.
Note that in almost every survey category, the proportion of SME employers where it is unknown
whether they were MEG-led is similar or higher than the proportion known to be MEG-led.

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Business statistics

Among SMEs without employees, 4% were MEG-led in 2022. 43 This has been
largely unchanged since 2015 (within one or two percentage points). MEG-led
SMEs without employees were most likely to be in the IT and communication(9%), accommodation and food (8%), retail (7%) and finance and insurance(7%) sectors. 44

7.3

Ethnic diversity of company boards
The Parker Review was a government-commissioned independent review into
the ethnic diversity of FTSE 100 boards in 2016. Published in 2017, this review
recommended that each FTSE 100 board should have “at least one director ofcolour by 2021; and each FTSE 250 board should have at least one director ofcolour by 2024.” 45 Annual reviews are produced by Ernst & Young andpublished on gov.uk.
As of December 2022, 96 FTSE 100 companies had at least one director from aminority-ethnic background, up from 89 in 2021. 46 49 companies had morethan one director from a minority ethnic background.
In total there were 178 FTSE 100 directors from minority ethnic backgrounds
holding 190 director positions (some individuals are directors of more than
one company). This represents 18% of all FTSE 100 board positions. Of these178 directors, just under half (47%) were women.
Of the 178 FTSE 100 directors from minority ethnic groups, 55% were Asian(9% of all director positions), 17% were Black (3% of all directors), 11% wereof mixed/multiple ethnicity (2% of all directors) and 17% were from otherminority-ethnic groups (3% of all directors).

43
44
45
46

27

DBT, Small business survey (employers) 2022, 31 August 2023, data table 31.
DBT, Small business survey (employers) 2022, 31 August 2023, data table 31.
Sir John Parker, A Report into the Ethnic Diversity of UK Boards, October 2017, page 10.
Parker Review Annual Report 2023, pages 18=20.

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Business statistics

Board members from minority-ethnic groups, 2022
FTSE 250

FTSE 100

Number of% of allNumber of% of alldirectors

directorships

178

18%

178

11%

Asian

98

9%

107

6%

Black

30

3%

23

1%

Mixed/Multiple ethnicity

20

2%

27

2%

Other minority-ethnic

30

3%

19

1%

All minority-ethnic groups

directors directorships

Of which:

Notes: data is as of 31 December 2022. The number of directors is the number of individuals, theproportion is of all available directorship positions. Some individuals are directors of more than one
company. There were 1,064 FTSE 100 and 1,074 FTSE 250 director positions in total. There were 26 FTSE
250 companies for which data was unknown. Two of the 178 FTSE 250 directors stated that they would
prefer not to say.
Source: Parker Review Annual Report 2023, pages 18–20 and House of Commons Library calculations.

Of the FTSE 250 companies, 149 companies (60%) had at least one director
from a minority ethnic background in December 2022; 21 companies had morethan one director from a minority-ethnic background. 47
There were 178 FTSE 250 directors from minority ethnic backgrounds,
occupying 188 director positions in total. This represents 11% of all FTSE250
board positions. 48 Of these 188 directors, just under half (48%) were women.
Of the 178 FTSE 100 directors from minority ethnic groups, 60% were Asian(6% of all directors), 13% were Black (1% of all directors), 15% were of
mixed/multiple ethnicities (2% of all directors) and 11% were of other minority
ethnic backgrounds (1% of all directors).

Board leadership positions
There are relatively few people from minority ethnic groups in Chair andexecutive director roles (for example, CEO and CFO), positions which typicallyhave more direct influence within companies compared to non-executive
director roles. 49
In FTSE 100 companies, there were 31 people from minority-ethnic groups in
Chair or executive director roles in December 2022: six held the position of
Chair, seven were CEOs, nine were CFOs and there were nine other executive
directors.

47
48

49

28

Parker Review Annual Report 2023, pages 18–20.
There were 26 FTSE 250 companies for which the number of ethnic-minority directors was unknown.
Some individuals are directors of both FTSE 100 and FTSE 250 companies.
Parker Review Annual Report 2023, page 15.

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Business statistics

In FTSE 250 companies, 34 executive directors were from minority-ethnic
backgrounds: five held the position of Chair, 14 were CEOs, 10 were CFOs andthere were five other executive directors. 50
From 2023, the Parker Review has asked FTSE 350 companies to set their own
targets for what the proportion of their senior management team (executive
directors) who self-identify as being in a minority ethnic group should be by
December 2027, and to report on that target to the Review.

7.4

Minority ethnic entrepreneurs
The Global Entrepreneurship Monitor Consortium found that the early-stage
entrepreneurial activity rate of the non-white population was significantly
higher (at 16.2%) than the white ethnic population (at 10.2%) in 2022, a trend
consistent with previous years. 51 The report does not provide a breakdown of
the non-white population. 52
The British Business Bank conducted research into the diversity of the UK’s
entrepreneurs in 2020 and their business outcomes. Their report, Alone
Together, found that:•••

4.4% of entrepreneurs were Black
5.9% were from Asian or other ethnic minority groups
89.9% were White.53

The report also analyses ethnicity of entrepreneurs against a number of otherdiversity characteristics including gender, age, place and household income.
The report found that minority-ethnic entrepreneurs experienced worse
business outcomes, such as lower median turnover and productivity,
compared to White business owners. Black – and particularly Black female –entrepreneurs were the worst affected. Other factors such as householdincome and place were also found to be important to business success.
Poorer entrepreneurs saw less success and most entrepreneurs did better
outside of London. Even after controlling for factors such as education,
income, sector and working patterns, the Bank concluded there weresystemic disadvantages for entrepreneurs that come from minority-ethnic
backgrounds and who are female. 54

50
51

52
53

54

29

Parker Review Annual Report 2023, pages 18–20.
Global Entrepreneurship Monitor, UK 2022/23 monitoring report, page 5. The TEA rate is thepercentage of the working age population (aged 18-64) who are either a nascent entrepreneur orowner-manager of a new business (up to three years old).
Global Entrepreneurship Monitor, UK 2022/23 monitoring report.
British Business Bank, Alone together: Entrepreneurship and diversity in the UK, October 2020, page
29.
British Business Bank, Alone together: Entrepreneurship and diversity in the UK, October 2020, page
6.

Commons Library Research Briefing, 8 May 2024

Business statistics

8

Further resources on business diversity

Other surveys and qualitative research have expanded the evidence base on
the demographics of UK business leaders and the challenges faced bybusinesses led by underrepresented groups. The following lists key sources inthis area. Many of these reports are intersectional looking at the impact ofboth ethnicity and gender.
•

Finding what works: Pathways to Improve Diversity in Venture Capital
Investment, British Business Bank, July 2023 – looks at venture capital
investment for start-ups and growing companies. The report found thatdiversity in venture capital investment is “extremely low”, but that there
are signs of progress in 2022. 55 The British Business Bank is agovernment-owned bank that supports small businesses accessfinance. 56•

Alone together: Entrepreneurship and diversity in the UK, British Business
Bank, October 2020 – looks at business outcomes for start-ups by
diversity characteristics including ethnicity, gender, place, disability,
age, household income, and education, including intersectional analysis.

•

Small Business Finance Markets Report 2024, British Business Bank,
March 2024 – section 1.5 and section 2.3 look at financing diverse
entrepreneurs. The report noted that female-led businesses are typicallyless willing to use finance to grow than their male-led counterparts. It
found that ethnic minority-led businesses are more open to using financebut, along with female-led firms, face barriers to getting it.57•

Ethnic Minority Businesses Report, BVA-BDRC, December 2023– report
produced by consultancy firm BVA-BDRC and UK Finance (trade body for
financial services sector) based on the experiences of minority ethnic-led
SMEs accessing finance from Q1 2022 to Q2 2023. 58•

Advancing the growth potential of UK’s Ethnic Minority businesses, Aston
University Centre for Research in Ethnic Minority Entrepreneurship(CREME) and NatWest, May 2022 – this report discusses ethnic minority
businesses’ barriers to growth. It summarises and draws on many of thereports listed in this section. 59

55

56
57
58
59

30

British Business Bank, Finding what works: Pathways to Improve Diversity in Venture Capital
Investment, July 2023
British Business Bank, Alone together: Entrepreneurship and diversity in the UK, October 2020.
British Business Bank, Small Business Finance Markets Report 2024, March 2024
BVA-BDRC and UK Finance, Ethnic Minority Businesses Report, December 2023
Aston University Centre for Research in Ethnic Minority Entrepreneurship (CREME) and NatWest.
Advancing the growth potential of UK’s Ethnic Minority businesses, May 2022.

Commons Library Research Briefing, 8 May 2024

Business statistics•

Minority Business Matters published by Minority Supplier Development UK(MSDUK, a membership organisation aimed at promoting diversity insupply chains), February 2021 – looks at the economic contribution of“minority businesses” to the economy and includes case studies andinterviews with business leaders. Minority businesses are defined toinclude businesses where a majority of shares are owned by someone
from a non-white ethnic minority in addition to minority sole traders andbusinesses where at least half of the founders or partners are from an
ethnic minority. 60•

Diversity Beyond Gender, published by Extend Ventures (a not-for-profit
organisation supporting diverse entrepreneurs), December 2023 – looks
at venture capital investment according to ethnicity, gender andeducational background over the past 10 years. 61 The report updates
data that was published in 2020.

•

Federation of Small Businesses, Unlocking Diversity: the value of ethnic
minority firms to UK economic activity and enterprise, July 2020 – looks
at the contribution of minority ethnic led businesses to the economy.
Reports that minority ethnic led businesses contribute £25 billion to the
UK economy each year. 62•

The Black Report is a 2020 report by 10x10 (a community of Black
founders and investors) in partnership with Google for Startups, thatlooked qualitatively at Black start-up founders. The report surveyed 60
Black founders based in London and its reported results are based on theexperiences of these individuals.63•

The Enterprise Research Centre publishes reports on a variety of businesstopics. 64

60
61
62

63
64

31

Minority Supplier Development UK, Minority Business Matters, February 2021.
Extend Ventures, Diversity Beyond Gender, December 2023.
Federation of Small Businesses, Unlocking Diversity: the value of ethnic minority firms to UK
economic activity and enterprise, July 2020.
10x10 and Google for Startups, The Black Report, 2020.
Enterprise Research Centre, Publications [accessed 28 November 2022].

Commons Library Research Briefing, 8 May 2024

Business statistics

9

UK business statistics: sources andcoverage

There is no single source in the UK which contains details of every active
business. There are three National Statistics sources that provide informationon the business population. These are:Business Population Estimates (BPE), produced by the Department for
Business and Trade (DBT), which provide the only estimate of the total UK
business population, including registered and unregistered businesses
UK Business; Activity, Size and Location publication, published by the
ONS, which provides detail on businesses that are registered for VAT
and/or PAYE.
Business Demography, from the ONS, which looks at the number ofbusiness openings and closures.

•

•

•

These sources are explained in more detail the DBT publication, A guide to the
UK Business Population and Demography. A brief overview is provided below.

Business Population Estimates
The Business Population Estimates, published by DBT, is the only official
source for data on the total number of enterprises in the UK, including bothbusinesses that are registered for VAT/PAYE and those that are not. It
provides data on the total number of businesses at national and region level,by main industrial sectors, and business turnover and employment. 65
There are three main sources that inform the BPE:
The ONS Inter-Departmental Business Register (IDBR)
the ONS Labour Force Survey and
HMRC self-assessment tax returns.

•••

The IDBR draws its information from HMRC records and it covers VAT and/or
PAYE registered enterprises only. 66 The BPE supplements the data withestimates of the number, employment and turnover of unregisteredbusinesses based on data from the Labour Force Survey (which covers selfemployed workers) and additional data from HMRC. After adjustment to65
66

DBT, BPE: methodology and quality note, 2022
The VAT registration threshold is VAT taxable turnover of £85,000, as of 1 March 2023.

32

Commons Library Research Briefing, 8 May 2024

Business statistics

avoid double counting (for example of VAT-registered sole proprietorships),
data from these three sources are combined in BPE.

Business activity size and location
Data on the number of VAT or PAYE registered enterprises only (excluding
unregistered businesses too small to be registered for VAT and with noemployees) are published in the annual ONS publication Business activity,
size and location. This publication is an annual extract of the InterDepartmental Business Register (IDBR), as of March each year.
It is the best source of information on businesses in local areas such as local
authorities and parliamentary constituencies and in small industry sectors.
However, since it excludes many small businesses, this publication is not agood source of information about the total number of businesses in the UK.
The data is available on the ONS NOMIS database.

Business demography
Information on business openings (births) and closures (deaths) is publishedin the annual publication, Business demography. Data in this source is also
based on the IDBR, and only covers VAT or PAYE registered enterprises.
Business demography examines active businesses across a whole year, rather
than at a particular point in the year (whereas Business activity, size andlocation only includes businesses active in March each year). The data is
produced with a year time delay after the reference period to account forbusinesses that become active again after a period of closure, this is in linewith international best practice. 67
During the pandemic, the ONS began publishing experimental quarterly
estimates of business demography to give an earlier indicator of the impact ofthe pandemic on the economy. 68

67

68

33

ONS, Business demography, quarterly experimental statistics, 27 October 2022, Section 6: measuring
the data.
Experimental statistics are official statistics that are in the testing phase and are not yet fully
developed

Commons Library Research Briefing, 8 May 2024

Business statistics

Other sources of business statistics
Data on businesses is also available from various surveys of the businesspopulation. Useful sources include:
•
•

•
•
•
•

34

ONS, Business Insights and Conditions Survey – a fortnightly survey
asking questions about current issues impacting businesses.
ONS Annual Business Survey – includes data on employment, turnover
and approximate Gross Value Added of sectors in the economy, down tovery detailed sectoral level.
DBT Annual Small Business Survey – annual survey of the SME population(see sections 6 and 7 of this briefing)
Global Entrepreneurship Monitoring report – global survey ofentrepreneurship (see sections 6 and 7 of this briefing)
Federation of Small Business (FSB), Small Business Index – quarterlyindex mapping the health and outlook of small businesses
Various ad hoc surveys conducted by business associations such as theFederation of Small Businesses and the Confederation of British Industry.

Commons Library Research Briefing, 8 May 2024

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